What is a zombie title?

If you own a home in the Chicago area and you have fallen behind in your payments, then you may have received or be close to receiving a notice of foreclosure. If the bank has already taken this step, then you should acquaint yourself with a zombie title. According to Reuters, the zombie title is a title that remains in your name after a bank initiates foreclosure proceedings.

Generally, what happens is that you receive a notice that your house is being taken over by the bank. Therefore, you pack up your belongings and move out of the home, leaving it to the control of your lender. Then, the bank never completes the process and you never receive notice that the bank has changed its mind. A year later, you start receiving bills for the property or a notice of collection from the city for cleanup fees or overdue taxes. The bank simply counts the property as a loss to them and then receives a credit on their tax filing or a payout from their insurer.

Meanwhile, during that year when the house sat abandoned, squatters, transients and others have used it, stripped it of anything that is worth monetary value and basically damaged it beyond repair. The lack of care to the property may have caused structural damage as well as led to overgrown grass, an abundance of weeds and an accumulation of garbage. Essentially, you are now haunted by a house that you cannot live in, you can’t afford to repair and you can’t sell. Furthermore, you still owe that mortgage money to the bank.

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